February 18, 2025

How Rate Caps and Minimums Quietly Erode Your Shipping Discounts

The Hidden Problem in “Discounted” Shipping Rates
You might think your 40% Ground discount is saving you a fortune—but if your agreement includes minimums or capped rates, you’re likely giving that money right back to the carrier.

These hidden clauses are buried deep in most UPS and FedEx contracts, and they can drastically reduce your realized savings without any obvious red flags.

How Rate Caps and Minimum Charges Work Against You

  • Minimum Charges: Even if you’re supposed to save 50% on a lightweight package, the carrier enforces a floor rate—meaning you still pay close to the full price.
  • Rate Caps: These restrict how much your discounts actually apply across certain zones or weights, effectively neutralizing your negotiation power.

The result? You think you’re getting a deal—but your actual costs tell a different story.

Why It Matters Now More Than Ever
With general rate increases (GRIs) and seasonal surcharges changing more frequently, these “quiet killers” are compounding fast. If you’re not actively auditing against your actual traffic patterns and minimum thresholds, you’re leaving real money on the table.

What RCS Does Differently
We don’t just plug in your discounts and call it a win. Our platform analyzes actual traffic data against your contract rules, so you can see exactly where minimums and caps are hitting your margins.

Even better? We flag those areas and suggest targeted negotiation points—because your rates should work for you, not against you.

Final Thought
It’s not the discount on paper that matters. It’s what actually hits your invoice.

Let us show you the difference between “looks good” and is good.

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